Sopra Steria reported first-half 2026 revenue of 2.96 billion euros, up 4.1% on a reported basis, as European governments increased spending on defence, cybersecurity and AI services. The French IT services firm raised its revenue growth target after operating profit on business activity climbed to 284.5 million euros, with the margin expanding to 9.6% from 9.2%.
Growth was strongest in defence, security and space, which rose 10%, and in aeronautics, which increased 12%. The numbers reflect a broader shift in European government priorities as member states confront security threats and invest in strategic digital infrastructure.
Defence Spending Drives Revenue
France accounted for 44% of group revenue. Organic growth in France reached 7.1%, supported by investments in public services, defence and strategic infrastructure. The second quarter benefited from defence-related work and improving trends in Germany and Belgium.
The company's performance underscores how European governments are channelling resources into areas that were neglected for years. Defence procurement, once seen as a budgetary afterthought, is now a growth engine for technology contractors. Cybersecurity and AI services are similarly benefiting from government recognition that digital sovereignty isn't optional.
What's Driving the Demand
The surge in defence and security spending reflects geopolitical realities Europe can't ignore. Governments that underfunded their militaries for decades are now scrambling to rebuild capabilities. That's created opportunities for firms like Sopra Steria that can deliver complex IT systems for defence, intelligence and critical infrastructure.
Aeronautics growth of 12% signals renewed investment in Europe's aerospace sector, which has struggled with supply chain disruptions and regulatory burdens. The 10% rise in defence, security and space revenue shows governments are willing to pay for services that protect national interests and reduce dependence on non-European technology providers.
France Leads, Germany Improves
France's 7.1% organic growth came from public sector modernisation and defence contracts. The fact that Germany and Belgium showed improving trends in the second quarter suggests the demand isn't limited to one country. It's a European phenomenon driven by shared security concerns and the need to digitise government services without relying on American or Chinese platforms.
The company's ability to lift its revenue growth target mid-year indicates confidence that this demand will continue. Operating margins improved even as the firm invested in new capabilities, suggesting the work is profitable and sustainable.
Why This Matters:
Sopra Steria's results are a snapshot of Europe's belated but necessary pivot toward strategic autonomy in defence and digital infrastructure. For years, European governments underspent on security while allowing critical IT systems to depend on foreign providers. That's changing. The 10% growth in defence and security services shows member states are finally investing in capabilities they should've built a decade ago. France's 7.1% organic growth, driven by public services and defence, demonstrates that governments willing to spend on strategic infrastructure can support domestic technology firms and reduce foreign dependence. The challenge now is sustaining this investment without letting it become another Brussels-managed spending programme that prioritises political optics over results. These contracts must deliver real capability, not just revenue for consultants.